Income Elasticity of Child Labor: Do Cash Transfers have an Impact on the Poorest Children?

Luca Pellerano; Eleonora Porreca; Furio C. Rosati

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Income Elasticity of Child Labor: Do Cash Transfers have an Impact on the Poorest Children?

Luca Pellerano

Eleonora Porreca

and

Furio C. Rosati

| Jul 01, 2020

IZA Journal of Development and Migration

Volume 11 (2020): Issue 1 (January 2020)

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Page range: -

DOI: https://doi.org/10.2478/izajodm-2020-0011

Keywords
child labor, education, cash transfer, randomized experiment, Lesotho

© 2020 Luca Pellerano, Eleonora Porreca and Furio C. Rosati, published by Sciendo

This work is licensed under the Creative Commons Attribution 4.0 International License.

Community Councils covered by Child Grant Programme (CGP) in Phase 1—Round 2.

Timeline of Child Grant Programme (CGP) (Phase 1—Round 2) evolution.

Sample and sample attrition

		Matched			Non-matched
	Status	Baseline	Follow-up	Final sample	Baseline only	Follow-up only	Attrition rate (%)
Eligible	T	747	732	706	41	26	5
	C	739	674	648	91	26	12
Total		1,486	1,406	1,354	132	52	9

Non-eligible	T	779	401	396	383	5	49
	C	789	405	401	388	4	49
Total		1,568	806	797	771	4	49

Total		3,054	2,212	2,151	903	61	30

Balance analysis on eligible children at baseline

	Treatment	Control	Difference
Panel A: outcome variables

Child level
Work (all activities)	0.32	0.29	0.03
Hours worked (all activities)	5.99	5.26	0.73
Days worked (all activities)	1.04	0.92	0.11
Farm work	0.34	0.33	0.01
Hours worked (farm activities)	6.78	6.04	0.74
Days worked (farm activities)	1.17	1.08	0.09
Enrolled in school	0.93	0.93	0.00
Homework/study outside school	45.23	45.53	–0.30
Total school expenditures	103.41	127.93	–24.52
School expenditure on fees	30.46	40.68	–10.22
School expenditure on uniforms/shoes	1.99	3.59	–1.6

Panel B: covariates

Child sex	0.49	0.50	–0.02
Child age	10.35	10.49	–0.14
Orphan child	0.13	0.13	0.00
Household size	6.06	5.70	0.37**
0–5 children present in the household	0.56	0.52	0.04
Female household head	0.51	0.55	–0.04
Age of household head	52.39	52.81	–0.42
Highest education among adults in the household	7.73	7.49	0.24
Economic shock	0.62	0.58	0.04
Expenditure per capita	117.94	125.78	–7.84
Asset index	–0.45	–0.50	0.05

Impact of the Child Grant Programme (CGP)—OLS

	(1)	(2)	(3)	(4)	(5)	(6)	(7)	(8)	(9)	(10)	(11)

	Work	Hours	Days	Farm work	Hours: farm	Days: farm	Enrolled at school	Time to study	School expenditures	School expenditures: fees	School expenditures: uniforms/shoes
Panel A
CGP	-0.02	-1.57	-0.33*	-0.02	-1.80*	-0.37*	0.05***	6.20**	39.60	-2.03	41.71***
	(0.035)	(0.979)	(0.172)	(0.035)	(0.949)	(0.193)	(0.018)	(2.424)	(35.671)	(28.360)	(6.845)
Panel B
CGP*1Q	0.04	0.43	0.04	0.05	-0.51	0.07	0.05	4.19	-44.83	-95.75	52.61***
	(0.058)	(1.714)	(0.345)	(0.061)	(1.712)	(0.389)	(0.030)	(5.365)	(79.592)	(63.817)	(15.085)
CGP*2Q	-0.01	-2.49	-0.30	-0.02	-2.55	-0.43	0.02	2.84	3.59	-18.85	34.44**
	(0.052)	(1.910)	(0.311)	(0.055)	(2.327)	(0.369)	(0.033)	(4.583)	(53.716)	(35.842)	(16.921)
CGP*3Q	0.01	-1.19	-0.30	0.01	-0.80	-0.29	-0.00	12.17**	73.77	43.95	40.25**
	(0.065)	(1.829)	(0.336)	(0.078)	(1.538)	(0.361)	(0.028)	(5.691)	(66.357)	(56.732)	(15.706)
CGP*4Q	-0.15**	-3.67**	-0.91***	-0.18**	-3.83*	-0.98***	0.15***	8.10*	210.89***	129.45**	39.68**
	(0.067)	(1.766)	(0.249)	(0.068)	(2.047)	(0.280)	(0.053)	(4.638)	(74.884)	(51.977)	(18.537)
Panel C
CGP*Age	-0.00	-0.16	-0.01	-0.00	-0.09	-0.01	0.02**	0.28	-5.42	-2.43	-1.60
	(0.009)	(0.309)	(0.054)	(0.010)	(0.330)	(0.061)	(0.007)	(1.194)	(19.183)	(14.379)	(3.451)
CGP*Female	-0.01	2.43	0.43	0.02	3.26*	0.62*	0.01	-5.32	21.01	36.01	-19.34
	(0.047)	(1.903)	(0.344)	(0.047)	(1.759)	(0.341)	(0.033)	(4.429)	(85.712)	(62.900)	(14.015)

Observation	1,938	1,938	1,938	1,734	1,716	1,717	1,938	1,707	1,749	1,747	1,740

Heterogeneous impacts—Quartiles of asset index (OLS)

	(1)	(2)	(3)	(4)	(5)	(6)	(7)	(8)	(13)	(14)	(15)

	Work	Hours	Days	Farm work	Hours: farm	Days: farm	Enrolled at school	Time to study	School expenditures	School expenditures: fees	School expenditures: uniforms/shoes
CGP*1Q	0.02	0.57	-0.02	0.03	-0.95	-0.06	0.03	1.39	68.78	44.43	28.90**
	(0.067)	(2.057)	(0.289)	(0.066)	(1.972)	(0.314)	(0.060)	(3.926)	(51.670)	(38.429)	(13.470)
CGP*2Q	-0.05	-1.69	-0.21	-0.07	-1.65	-0.30	0.00	13.41**	18.60	-26.26	42.65**
	(0.060)	(1.756)	(0.269)	(0.060)	(1.534)	(0.296)	(0.020)	(6.185)	(69.368)	(49.089)	(19.375)
CGP*3Q	0.10	-0.41	-0.42	0.09	-0.28	-0.43	0.07***	6.92	28.52	-0.52	35.85**
	(0.059)	(1.630)	(0.317)	(0.062)	(1.767)	(0.331)	(0.024)	(4.875)	(72.189)	(48.429)	(16.298)
CGP*4Q	-0.14**	-3.85**	-0.69*	-0.16***	-3.63**	-0.74*	0.07**	2.77	28.14	-18.28	49.40**
	(0.056)	(1.703)	(0.352)	(0.059)	(1.753)	(0.376)	(0.033)	(4.247)	(90.555)	(63.279)	(19.755)

Observation	1,967	1,967	1,967	1,764	1,744	1,745	1,967	1,734	1,777	1,775	1,768

Probability to remain in the sample and quartiles of expenditure per capita

Variables	Probability to remain in the sample

1Q	0.13
	(0.090)
2Q	–0.01
	(0.083)
3Q	0.06
	(0.082)
HH size	0.05***
	(0.014)
Dependency ratio	0.00***
	(0.000)
One member household	–0.65***
	(0.236)
Double orphan in the household	–0.04
	(0.083)
Non resident head	–0.10
	(0.099)
Chronically ill member in the household	–0.05
	(0.061)
Savings	–0.01
	(0.061)
Livestock	–0.10
	(0.065)
Land	0.19**
	(0.095)
Asset index	–0.01
	(0.018)
nissa1	0.77***
	(0.087)
nissa2	0.48***
	(0.085)
nissa3	0.06
	(0.145)
nissa4	–0.13
	(0.149)
Constant	–0.50**
	(0.206)

Beneficiaries’ perceptions and experience with the Child Grant Programme (CGP)

	Percentage of household
Selection criteria for CGP
Household poverty	64.32
Children in household	15.5
Orphans in household	14.77
Person responsible for CGP spending
Household head	75.5
Other household member	20.9
Children	1.08
Primary use of last CGP payment
Food for household	43.96
Food for children	17.84
Shoes and clothing for children	19.64
Education expenditures	17.12

Impact on non-eligible children—OLS

	(1)	(2)	(3)	(4)	(5)	(6)	(7)	(8)	(9)	(10)	(11)
	Work	Hours	Days	Farm work	Hours: farm	Days: farm	Enrolled at school	Time to study	School expenditures	School expenditures: fees	School expenditures: uniforms/shoes
Child Grant Programme	-0.01	-0.09	-0.12	-0.01	-0.47	-0.12	-0.01	-2.05	-40.06	-55.09	8.98
	(0.05)	(1.90)	(0.24)	(0.05)	(1.81)	(0.24)	(0.02)	(4.22)	(80.05)	(57.32)	(21.52)

Observation	799	799	799	741	724	728	798	707	742	741	739

eISSN:: 2520-1786
Language:: English

Publication timeframe:: Volume Open
Journal Subjects:: Business and Economics, Political Economics, Microeconomics, Macroecomics, Economic Policy, Mathematics and Statistics for Economists, Econometrics

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Income Elasticity of Child Labor: Do Cash Transfers have an Impact on the Poorest Children?

Published Online: Jul 01, 2020

Page range: -

DOI: https://doi.org/10.2478/izajodm-2020-0011

Keywords
child labor, education, cash transfer, randomized experiment, Lesotho

© 2020 Luca Pellerano, Eleonora Porreca and Furio C. Rosati, published by Sciendo

This work is licensed under the Creative Commons Attribution 4.0 International License.

Figure 1

Figure 2

Figure 3

Sample and sample attrition

Balance analysis on eligible children at baseline

Impact of the Child Grant Programme (CGP)—OLS

Heterogeneous impacts—Quartiles of asset index (OLS)

Probability to remain in the sample and quartiles of expenditure per capita

Beneficiaries’ perceptions and experience with the Child Grant Programme (CGP)

Impact on non-eligible children—OLS

Income Elasticity of Child Labor: Do Cash Transfers have an Impact on the Poorest Children?

Published Online: Jul 01, 2020

Page range: -

DOI: https://doi.org/10.2478/izajodm-2020-0011

Keywordschild labor, education, cash transfer, randomized experiment, Lesotho

© 2020 Luca Pellerano, Eleonora Porreca and Furio C. Rosati, published by Sciendo

This work is licensed under the Creative Commons Attribution 4.0 International License.

Figure 1

Figure 2

Figure 3

Sample and sample attrition

Balance analysis on eligible children at baseline

Impact of the Child Grant Programme (CGP)—OLS

Heterogeneous impacts—Quartiles of asset index (OLS)

Probability to remain in the sample and quartiles of expenditure per capita

Beneficiaries’ perceptions and experience with the Child Grant Programme (CGP)

Impact on non-eligible children—OLS

Keywords
child labor, education, cash transfer, randomized experiment, Lesotho